Gold Prices Pop After GDP Numbers
Source: The Street, Andrea Tse (10/29/10)
"U.S. GDP numbers met expectations, stocks appeared lackluster."
Gold for December delivery was popping by $5.50 to $1,348 an ounce at the Comex division of the New York Mercantile Exchange. The gold price Friday has traded as high $1,352.90 and as low as $1,335.20.
The U.S. dollar index was adding 0.1% to $77.40, while the euro was down 0.3% to $1.39 against the dollar. The spot gold price was up more than $4, according to Kitco's gold index.
The Department of Commerce at 8:30 on Friday reported that the U.S. economy grew by 2% in the third quarter, which was in line with expectations, according to Briefing.com, though a Dow Jones Newswires poll of economists showed consensus GDP growth expectations of 2.1%.
The economy grew by 1.7% in the second quarter.
Other U.S. economic data slated for release on Friday included the Chicago Purchasing Managers Index and the Reuter's-University of Michigan's Consumer sentiment index.
On Thursday, gold prices climbed as the dollar caved on quantitative easing concerns. Gold prices were shifting between positive and negative territory throughout the week as traders and investors tried to factor in the size of the Fed Reserve's next round of quantitative easing (QE). Although another round of QE is expected, many are still concerned that the size of it may be less than expected.
The next set of Federal Open Market Committee minutes will be released at 2 p.m. next Wednesday.
"As a whole we expect the theme of dip-buying to continue, particularly in gold as physical buying picks up ahead of peak buying period," FastMarkets research analyst James Moore said in a daily newsletter. "Silver could also be in for a choppy ride as the hearing into market manipulation continues."